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The short answer, and the denial stack that started this post
Behavioral health prior authorization in 2026 is a margin-transfer mechanism, not a paperwork problem. The CMS Interoperability and Prior Authorization Final Rule (CMS-0057-F) tightened decision timeframes for Medicare Advantage, Medicaid managed care, and CHIP starting January 1, 2026, but commercial ERISA plans sit outside that timer, and the September 2024 MHPAEA final rule that operators were counting on sits on an enforcement pause as of May 15, 2025. Operators who want their money back have to work the gap themselves.
Last month a 24-bed Level 3.5 program in Palm Beach County sent us a stack of 31 concurrent review denials from a single national payer, all issued inside a 60-day window. Average length of stay approved on initial cert: 4.2 days. Medical necessity criteria cited: the payer’s internal guidelines, not the ASAM Criteria, 4th Edition. The clinical director had been writing peer-to-peer notes at 9pm three nights a week for a quarter.
That is the actual operating reality. Not a policy abstraction. A clinical director burning out while $480,000 in billed charges sits in suspended AR, and days in AR creeping past 71. The payer knows the math. Every day a claim sits unworked is a day closer to the operator writing it off.
What DOL and CMS actually did, and what got paused
On September 9, 2024, the Departments of Labor, HHS, and Treasury finalized rules implementing MHPAEA that, among other things, set content requirements for nonquantitative treatment limitation (NQTL) comparative analyses, including prior authorization and concurrent review. Then the brakes came on. On May 15, 2025, the Departments announced they “will not enforce the 2024 Final Rule or otherwise pursue enforcement actions, based on a failure to comply that occurs prior to a final decision in the litigation, plus an additional 18 months.”
The Departments were explicit that “MHPAEA’s statutory obligations, as amended by the CAA, 2021, continue to have effect.” Translation: the comparative analysis obligation on the books since 2021 is still alive. The new content rules from 2024 are on ice. As Groom Law Group put it, the longstanding NQTL rule from the 2013 final rules and the CAA, 2021 provisions remain in force.
CMS followed a separate track. On January 17, 2024, it published the Interoperability and Prior Authorization Final Rule (CMS-0057-F), which requires impacted payers (Medicare Advantage, Medicaid and CHIP FFS, Medicaid managed care, CHIP managed care, and QHP issuers on the FFEs) to send prior authorization decisions within 72 hours for expedited requests and seven calendar days for standard requests. Public reporting of aggregated prior authorization metrics begins in 2026, with the initial annual report due March 31, 2026. Commercial ERISA plans are not in that bucket. That is the gap every operator needs to map onto their payer mix.
Where state regulators are picking up the slack, and where they are not
In August 2021, the New York Attorney General and the U.S. Department of Labor jointly settled with UnitedHealthcare for $15.6 million, after EBSA investigators found that, going back to at least 2013, United reduced reimbursement rates for out-of-network mental health services and flagged participants undergoing mental health treatment for utilization review. By May 2022, the settlement administrator had distributed $13.6 million to affected consumers, with almost $8 million paid to more than 20,000 New Yorkers. Then-Secretary of Labor Marty Walsh said the settlement “provides compensation for many people who were denied full benefits and equitable treatment.”
That is the receipt operators should hand a peer-to-peer reviewer who claims ALERT-style outlier management is industry standard.
Illinois HB 2595 still requires generally accepted standards for SUD level-of-care decisions, though enforcement runs hot and cold. Florida is a different animal. The Office of Insurance Regulation has not been aggressive on parity. AHCA’s Medicaid managed care focus has been fraud, waste, and abuse on the provider side, not prior auth abuse by the plans. If your team runs a Florida facility and your appeals strategy assumes a regulator will eventually back you up, rebuild the strategy. Your pressure points are contractual and clinical, not regulatory.
Five operational moves your team should make on Monday
- Cite ASAM Criteria, 4th Edition by dimension and by level of care in the medical record before the call. Every initial cert and concurrent review note, in the clinician’s own words, before the peer-to-peer. Payer reviewers are trained to ask for specifics. Vague risk language gets your team a denial and a peer-to-peer your clinical director will lose at 9pm.
- Track NQTL evidence per payer. Have your UR lead pull a sample of 50 concurrent reviews per quarter per payer and log: criteria cited, reviewer credentials, decision turnaround, overturn rate on appeal. A DOL investigator or a plaintiff’s attorney will ask for that dataset. It is also what gets a contract renewal conversation past pleasantries.
- For ERISA self-funded plans, send a written request for the plan’s NQTL comparative analysis under the CAA, 2021. The 2024 final rule’s new content requirements are on enforcement pause, but the 2013 NQTL rule and the CAA, 2021 provisions remain in force. Most plans will not have a clean one ready. That silence is useful in litigation and at the bargaining table.
- File external appeals. Actually file them. A KFF analysis of Medicare Advantage data found that only 9.9% of denied prior authorization requests were appealed in 2022, yet 83.2% of those appeals resulted in the insurer partially or fully overturning the initial denial. Operators who appeal fewer than a quarter of denials leave real money on the table. Build the appeal queue into the UR workflow, not as a separate project.
- Segment your payer mix by denial behavior, not just by allowable. A payer paying 92 percent of Medicare with a 22 percent denial rate is worse than a payer paying 78 percent with a 6 percent denial rate. Run the math per payer, per level of care. Then renegotiate, terminate, or shift census.
Where this is heading
The CMS public reporting requirement is going to embarrass several large plans. Impacted payers and state MCOs must publicly post aggregated prior authorization metrics annually, with the initial CMS reporting due March 31, 2026, covering calendar year 2025 metrics. That data will fuel state legislation in 2026 and 2027, particularly in states with active AGs.
Expect commercial plans to quietly tighten initial cert criteria before any parity comparative analyses get subpoenaed in private litigation. Expect more single case agreements offered to out-of-network programs that have documented medical necessity better than the in-network competition.
ERISA litigation is the lever that did not get paused. Plaintiffs’ attorneys and plan participants can still enforce the CAA, 2021 requirements directly. EBSA investigators will keep opening files even without the 2024 content rules in play. KFF’s most recent analysis found that Medicare Advantage insurers made nearly 53 million prior authorization determinations in 2024, and more than eight in ten appeals overturned the initial denial across every year examined. Read that number twice. The payer knows the math. Now your CFO should too.
If your team wants to walk through your denial dataset, your payer mix, or how to structure a CAA, 2021 comparative analysis request letter, reach out to Atlantic Health Strategies directly. Bring a denial log. The conversation gets useful when real numbers are in front of us.
Frequently asked questions
Does CMS-0057-F apply to commercial ERISA self-funded health plans?
No. Per the CMS fact sheet, the Interoperability and Prior Authorization Final Rule applies to Medicare Advantage organizations, state Medicaid and CHIP fee-for-service programs, Medicaid managed care plans, CHIP managed care entities, and Qualified Health Plan issuers on the Federally Facilitated Exchanges. Commercial ERISA self-funded plans are not impacted payers under CMS-0057-F, which is why parity litigation and DOL enforcement remain the operator’s main lever against those plans.
Is the MHPAEA 2024 final rule still enforceable in 2026?
Not in full. On May 15, 2025, the Departments of Labor, HHS, and Treasury announced they will not enforce the 2024 Final Rule for failures to comply that occur before a final decision in the pending ERISA Industry Committee litigation, plus 18 months. The 2013 final rule and the underlying CAA, 2021 statutory requirement that plans perform and document NQTL comparative analyses, and provide them on request, remain in effect.
What are the new CMS prior authorization decision timeframes that started January 1, 2026?
Under CMS-0057-F, impacted payers must send standard (non-urgent) prior authorization decisions within 7 calendar days and expedited (urgent) decisions within 72 hours, and must provide a specific reason for each denial. Public reporting of aggregated prior authorization metrics from the prior calendar year begins in 2026, with March 31 as the recurring annual reporting date.
How often do prior authorization denials get overturned on appeal?
In Medicare Advantage, a KFF analysis found that 83.2% of appealed prior authorization denials were partially or fully overturned in 2022, yet only 9.9% of denials were appealed. Updated KFF data for 2024 shows 80.7% of appeals were still overturned, with more than eight in ten appeals overturned across every year examined. Treatment centers that don’t build a systematic appeal workflow are writing off recoverable revenue.
References
- CMS Interoperability and Prior Authorization Final Rule CMS-0057-F Fact Sheet, Centers for Medicare & Medicaid Services
- Statement of U.S. Departments of Labor, HHS, and Treasury regarding enforcement of the MHPAEA 2024 Final Rule (May 15, 2025)
- U.S. Department of Labor news release: United Behavioral Health, UnitedHealthcare Insurance Co. Plans to pay $15.6M (August 12, 2021)
- New York Attorney General press release: $13.6 million provided to consumers who were denied mental health care coverage (May 20, 2022)
- KFF: Medicare Advantage Plans Denied a Larger Share of Prior Authorization Requests in 2022 Than in Prior Years
- KFF: Medicare Advantage Insurers Made Nearly 53 Million Prior Authorization Determinations in 2024
- Groom Law Group: Departments Pause Enforcement of MHPAEA Final Rule and Reconsider Enforcement Program
- Virginia DMAS Provider Bulletin: Interoperability and Prior Authorization Final Rule Implementation Update